“If you were a dog, what kind would you be?” Gross asks readers. “I can’t say I’ve thought about it a lot myself, but it is an interesting, possibly introspective question considering the theory that many dog owners pick a breed that looks or perhaps acts like themselves.” Gross even uses the forum to reminisce a little bit about his own past canine companions — from a German Shepherd, named Budgie, to “Wiggles, the irrepressible Pomeranian.”

Anyone familiar with Gross’ personal brand of zany and meandering — though often entertaining — investment writing would not be surprised to see the legendary money manager quickly pivot from dog-talk to a discussion of global financial markets. Gross goes on to cover issues facing investors at a time when global markets are experiencing “an undeclared currency war” that he says has driven down interest rates around the world, particularly in the U.S., where interest rates are finally poised to rise after hovering near zero as part of the Federal Reserve’s quantitative easing policies that went into effect in 2009.

Gross points out the dangers of lower interest rates, which, he writes, “globally destroy financial business models that are critical to the functioning of modern day economies. Pension funds and insurance companies are perhaps the most important examples of financial sectors that are threatened by low to negative interest rates.”

Investors who have been in favor of lower rates, while fearing an eventual hike in the U.S., need to be concerned about the downside of those policies, writes Gross, who believes lower rates result in people saving more, rather than spending more to spur economic growth.

Gross closes the letter by returning to the dog metaphor and offering a piece of advice: “‘Home bred’ monetary policies earn ‘blue ribbon’ rewards in the short term, but in the long run may undermine the entire show and send the dogs towards the exits. Stay conservative in your investment portfolio. Own high quality bonds and low P/E, high quality stocks if you want to stay out of the doghouse. Arf, Arf.”

Buffett’s letter and Zuckerberg talks mobile — 5 things to know today

Wall Street stock futures are gaining this morning, and European shares have declined from their highest level in more than seven years. Asian markets closed the day mostly higher.

Over the weekend, Warren Buffett published the 50th annual letter to Berkshire shareholders. In it, he told the group he had found his successor. Speculation has mounted among Berkshire investors over who will eventually succeed the 84-year-old. Here are some of the best one-liners from Buffett’s letter.

On CNBC this morning Buffett reiterated his view that Hillary Clinton will be the next president of the United States. He first made the prediction at Fortune’s Most Powerful Women summit last fall. Watch his appearance (and prediction) again here:

Here’s what else you need to know about today.

1. Business leaders gather in Barcelona for the Mobile World Conference.

The world’s biggest annual cellphone conference kicks off today. Already, Qualcomm QCOM and Intel INTC have introduced new biometic security technology that would use readings from the human body — such as a fingerprint or a facial reading — to allow access to devices instead of traditional passwords.

The more than 85,000 attendees are getting ready to hear keynotes from two Americans who hold impressive sway over the future of the mobile industry: Facebook FB CEO Mark Zuckerberg and U.S. Federal Communications Commission Chairman Tom Wheeler. Zuckerberg will discuss expanding Internet access in developing countries, while many will be hoping Wheeler will discuss the FCC’s recent adoption of net neutrality rules.

NXP NXPI paid nearly $12 billion in cash and stock to acquire Austin, Tex.-based Freescale Semiconductor FSL, which will help expand its reach in chips made for cars. The deal values Freescale at $36.14 a share, almost equal to the company’s closing price of $36.11 on Feb. 27, reported Bloomberg. The merged company will have about $10 billion in annual sales, making it the world’s eighth-largest chipmaker. As cars continue to get more advanced and require more processors and electronics, NXP and Freescale are set to benefit. The additional scale will help expand market share and reduce costs, the companies said.

3. Russia and Ukraine meet to discuss energy.

European Union leaders are hosting both Russian and Ukrainian leaders in Brussels today to broker energy talks between the two nations. Gas supplies have been used as a weapon in the conflict, as Russian threatens to cut off gas to Ukraine as a shaky ceasefire remains in place in east Ukraine. If Russia cuts off the gas deliveries, it could affect other European nations as well, since Ukraine is a key transit route into the EU.

The Chinese central bank cut interest rates again in a surprise move as the nation pursues ever more aggressive measures to rev up economic activity. The People’s Bank of China cut rates by a quarter of a percentage point nearly four months after the last reduction. The world’s second-largest economy has been struggling with a slumping property market, capital drains that are affecting banks’ lending capacity and fears of impending deflation. The unexpected rate cut bolstered Asian markets today, though many worry about China’s “new normal” of slower growth. Chinese leadership will address the issue with new policy goals for the year when the new legislative session starts Thursday.

Billionaire and Berkshire Hathaway CEO Warren Buffett released his annual letter to shareholders on Saturday. The note, full of Buffett’s famous folk wisdom, also gave hints as to who may be next in line to take over the top leadership role if Buffett were to pass away or step down. Buffett, who celebrates his 50th year at the helm of his company, said that that Berkshire Hathaway’s BRK board has identified his successor but didn’t reveal his or her identity. Vice Chairman Carlie Munger, in a separate note, hinted that either Ajit Jain, an insurance executive at the company, or Greg Abel, head of Berkshire’s energy unit, would take over as CEO.

10 reasons the housing market could go ballistic this spring

I’m guessing here. My forecasts aren’t any better than anyone else’s, so don’t trade on this. But my gut is telling me that the U.S. housing market could go ballistic this spring, specifically for single-family homes—especially among first-time buyers.

A few reasons:

1. Everyone sees that the zero interest rate party is coming to an end. If you’ve been waiting to borrow, it’s getting close to “now or never” time. Fear of missing out (what the kids call “FOMO”) is as powerful a motivator as anything.

2. Demand is pent-up, and pent-up things eventually get un-pent, sometimes all at once. The number of people between ages 35 and 39 is critical to household formation, and we are currently seeing an uptick in this demographic category, back to prior peaks.

3. The notion that millennials want to stay home forever is not accurate. They’re ready to bust out, and rental prices are comparably high in several key regions.

4. Employment among college-educated people (read: potential home buyers) is as tight as a drum.

5. In January, average hourly earnings jumped 0.5% for all American workers. This is just one month’s worth of data, of course, but it is significantly above trend (average hourly earnings have grown at an annual average of just 2% in the post-crisis recovery period). When people get one-time tax cuts or bonuses, they save them. When people get raises, however, they buy stuff and improve their standard of living.

6. At the low end of the income spectrum, things are brightening. Wal-Mart, Aetna, and TJ Maxx are giving a million minimum-wage earning Americans a raise this year. These companies are the tip of the spear. Others will be forced to follow. Twenty-nine states have unilaterally hiked minimum wages in the last two years. If the federal government acts this year on a proposed 40% national wage hike to over $10 an hour, look out above.

7. If you believe, as I do, that the stock market acts as a discounting mechanism and foreshadows the near future, then you may want to take a glance at the iShares US Home Construction ETF ITB. It’s just broken out above major resistance dating back to the May 2013 “taper tantrum,” when the Fed first raised the specter of rising rates. The homebuilding stocks within this ETF are now trading higher than their peak prior to those fears, which signals better fundamentals to come, in my view.

8. Animal spirits in the stock market have finally, truly taken hold and participation is broadening out from just the wealthiest 20% of investors.

10. I’m actually cheating a little because a housing market uptick is already in progress. Last month’s ground-breaking on new homes hit the equivalent of a 1.07 million annual run-rate. According to Bloomberg data, this is a jump of over 6.4% from 2014.

Again, take this (and any other prediction) with a grain of salt. Even if you disagree with this call, hopefully it has at least given you something to think about.

U.S. stock futures are little changed this morning after the S&P 500 closed at a record yesterday, and the tech-heavy Nasdaq index finished up nearly 5% on the year as it climbs to levels not seen since the Internet bubble burst 15 years ago. European markets are slightly lower in trading today, while Asian shares ended mostly up.

Earnings in focus today include reports from Target TGT and Salesforce CRM, which reports after the market closes.

Here’s what else you need to know about today.

1. Yellen, day two.

Federal Reserve Chairman Janet Yellen goes before the House Financial Services Committee today following her testimony in the Senate yesterday. She said that the Fed would signal any upcoming changes in interest rates, which are being considered on a “meeting-by-meeting basis.” A rate hike could come as soon as June, although investors expect it to come later in the year given Yellen’s sentiment. Yellen also came prepared to oppose the current “Audit the Fed” legislation proposed by Republican Senator Rand Paul — a move that’s about power not transparency, explains Fortune’s Chris Matthews.

2. Abercrombie & Fitch case heads to the Supreme Court.

The U.S. top court will hear arguments today concerning workplace discrimination by Abercrombie & Fitch ANF when it refused to hire a Muslim applicant who was wearing a head scarf during the interview. The teen clothing retailer said the hijab didn’t comply with the company’s dress code. The Supreme Court will decide if Abercrombie’s action was legal, as well as answer questions about who is responsible for addressing conflicts between an employee’s religious practices and a company’s policies.

3. Apple found guilty in patent case.

A Texas court said Apple must shell out $532.9 million after a federal jury found the tech giant guilty of patent infringement. The jury agreed that Apple AAPL had illegally used three patents owned by Smartflash in its iTunes software. Smartflush, a company based in Texas, doesn’t make any products itself but considers itself a patent licensing company. Apple balked at the decision and promised “to take this fight up through the court system,” according to a company press release.

4. HSBC goes to Parliament.

HSBC HSBC has faced a rough few weeks. First, it was revealed that the bank is sheltering tax-free accounts of arms dealers and politicians in its Swiss branch. Then, the CEO’s own tax affairs came under scrutiny when it came out that his bonus was moved between Switzerland and Panama to avoid detection. Now, two top HSBC executives will face a grilling by UK lawmakers over allegations that the bank helped clients evade taxes. Lawmakers want to know how extensive the problem may be and what the bank is doing to curb the issue.

5. China manufacturing improves.

China’s manufacturing sector unexpectedly improved in February after a dismal four-month streak. The HSBC Purchasing Managers’ Index rose to 50.1 from January’s 49.7, any result above the 50-mark indicates expansion and anything below that number means manufacturing is contracting. This is the first time in four months that China’s manufacturing expanded. That’s better, but there’s still worrying underlying data. Factory employment fell for the 16th straight month and both input and output prices declined. Domestic growth is likely to remain muted as the central bank seeks to spur growth with further stimulus.

‘Audit the Fed’ is about power, not transparency

Janet Yellen was on Capitol Hill Tuesday for the first of two hearings in front of the Senate and House, respectively, to defend Fed policy and advise Congress.

On Tuesday, the Fed chair faced grilling from the new Republican Senate. She came prepared first and foremost to dissuade lawmakers from supporting so-called “Audit the Fed” legislation proposed by Kentucky Senator and likely presidential hopeful Rand Paul and cosponsored by 30 other legislators. The bill would, among other things, increase Congress’ ability to oversee the Fed’s interest rate decisions.

“I strongly oppose Audit the Fed,” said Yellen during questioning, arguing that it would “bring short-term political pressures to bear” on the central bank and dissuade it from making the “hard choices” needed to keep inflation in check. She said that in cases where countries have suffered from excessive inflation, the central banks managing those economies often kept monetary policy too loose due to political pressure to boost economic growth.

But if you watched Tuesday’s hearing closely, there didn’t seem to be much appetite for getting Congress involved in interest rate decisions so much as a general dissatisfaction with the distribution of power at the central bank. Republican Senator Bob Corker tossed Yellen a series of softballs on the audit question, allowing the chair to explain the degree to which its assets are already audited by independent firm Deloitte and the fact that the Fed’s balance sheet is published online.

But senators on the right and left lobbed several criticisms at the Federal Reserve. Senate Banking Committee Chair Richard Shelby began his questioning by asking for Yellen’s opinion on a recent proposal by outgoing Dallas Fed President Richard Fisher that the Fed be reorganized to make the Federal Reserve Bank of New York much less powerful and distribute that influence to other regional banks. Fisher argued that making the President of the New York Fed at all times the Vice Chairman of the Federal Reserve Board of Governors gives too much power to a regional bank that has very close ties to Wall Street’s biggest and most powerful banks.

Democratic Senator Jack Reed of Rhode Island, who recently submitted legislation that would require the President of the New York Fed to be confirmed by the Senate, echoed Shelby’s concerns. He called attention to recent media reports that suggested that regulators at the New York Fed have been successfully cowed by the very institutions they are supposed to be regulating. The Federal Reserve is reviewing whether the New York branch is in fact too close to Wall Street, but the results of that study have yet to be made public.

According to Chris Krueger, an analyst with Guggenheim Securities, Congress is more likely to take some power away from the New York Fed than it is likely to expose interest rate decisions to further oversight. In a note to clients, he writes:

It is our belief that some version of the Fisher Plan becomes the new Audit the Fed bill and it is something that the Federal Reserve Board will have much more trouble stopping because it will feed upon anti-New York/anti-mega bank bias that exists in Congress. While the Federal Reserve Board may have objections to the Fisher Plan, it is certainly more palatable than the current Rand Paul bill – and also far less likely to spook markets.

This guy knows the secret to beating low interest rates

This post is in partnership with Time. The article below was originally published at Time.com.

In the early days of 2015, few people have been more alone—and right—about bonds than Jeffrey Gundlach. That doesn’t mean the whole year will go his way. But fixed-income investors should probably lend an ear to his contrarian view.

Gundlach is the founder and chief investment officer of DoubleLine Capital. Forbes recently crowned him “the new bond king” for his ability to stand against the crowd and rack up big gains. Gundlach was betting on lower rates in 2011 when reigning bond king Bill Gross was betting the other way. Gundlach proved right. Gross was later forced out at PIMCO PHK, the giant asset manager he had founded—and a new king ascended the throne.

Today, Gundlach is at it again. While almost all of Wall Street has been forecasting higher bond yields, he has been predicting another year of falling yields and solid returns. Economists generally expect the 10-year Treasury bond yield to rise to 2.5% to 3%, from about 1.7% now. Gundlach believes we’re headed below (maybe well below) the record low yield of 1.38%, giving bondholders another year of returns in excess of the interest payments they collect.

Why should you listen? Just a month ago the T-bond yield stood at 2.2%, and most economists were forecasting a rise to 3.25% or higher. So while Gundlach has been on target, racking up gains, others have been scrambling to adjust.

Interest rates have been falling pretty much nonstop since 1981, when Justin Timberlake was a newborn and Blondie was a hit maker. They will reverse at some point, and with the Fed signaling its first short-term funds hike since the recession (after midyear) a lot of pros figured this would be the year. That may yet prove to be the case—and if it is, investing for income will turn out to be a dangerous game.

Bond prices fall when yields rise. In normal times, an orderly decline in bond prices isn’t such a big deal. But with yields so low there isn’t a lot of cushion. Even a modest decline in prices would overwhelm the income from a bond yielding less than 2%. In recent years, income investors have flocked to riskier but higher yielding junk bonds and bond substitutes like real estate investment trusts, master limited partnerships and preferred shares. All of those now look priced for low returns this year—and if yields move higher losses are not out of the question.

For that reason, most experts say income investors should be diligent about diversification and stick with the highest quality credit. They advise staying away from long-term bonds, which are most sensitive to swings in interest rates. Bonds that mature in about five years appear to be the sweet spot. A fund like Vanguard Total Bond Market would help with this approach with a 2.5% yield, high-quality holdings, and an average maturity of 5.6 years. Another widely advised approach is dividend-paying stocks through an ETF like iShares Select Dividend. You can collect around 3% in income and, with the economy looking healthy, could see share prices move up as well.

If Gundlach is right, though, you may do better in long-term bonds, REITs that do not own shopping malls, and maybe even junk bonds. His contrarian view is largely based on weak oil prices, which tamp down inflation worries, and on slowing economies and ultra-low bond yields overseas, which make the T-bond yield look fat. A strong dollar helps his case.

A year ago, Gundlach correctly predicted falling yields, weakness in junk bonds, and the end of the Fed’s bond-buying program. So far this year, he’s been right on rates again. So maybe the bond market isn’t as dangerous as it seems, and income investors can eke out another good year.

Fed says it will maintain its ‘patient’ approach to rate hikes

A new policy statement released by the U.S. Federal Reserve Wednesday shows the central bank is essentially staying the course regarding a timeframe for an eventual interest rate hike.

The Federal Open Markets Committee concluded its two-day meeting with a public statement in which the committee reaffirmed its promise to remain “patient” on the issue of raising rates for the first time since 2006. Rates are expected to remain at their current level, which is near zero, until at least this summer and could be unmoved until even later in the year.

“Based on its current assessment, the committee judges that it can be patient in beginning to normalize the stance of monetary policy,” the FOMC said in its statement.

The committee noted that the U.S. economy “has been expanding at a solid pace” since the FOMC’s December meeting. The statement highlighted job gains and the unemployment rate’s continued decline as signs of an improving labor market while also noting that lower fuel prices have led to a rise in consumer spending. The committee said it expects the economy will continue to “expand at a moderate pace” and that inflation will continue to decline before eventually inching toward 2% “over the medium term” as labor conditions improve and the effects of low oil prices wane.

However, the committee added, any signs indicating “faster progress” toward the FOMC’s employment and inflation targets could trigger earlier action on interest rates, though an economic slowdown could also push the eventual action back further. The FOMC maintained its pledge to “take a balanced approach” with the interest rate decision, keeping in mind its goals of “maximum employment” and 2% inflation. And, even after the FOMC’s employment and inflation goals are reached, the committee expects that it could continue to maintain lower-than-normal interest rates “for some time.”

In the wake of the latest FOMC statement, Reuters reports that short-term interest-rate futures activity is already showing a majority of traders betting on October 2015 as a likely target for interest rates to rise.

Famed bond investor Bill Gross of Janus Capital told CNBC on Wednesday that he thinks the Fed will raise interest rates by 25 basis points around June in what he characterizes as a symbolic move.

The Federal Open Markets Committee (FOMC) is still skittish about signaling a move away from its easy-money policies that have been in place since the financial crisis. However, the group has started to talk about moving “toward normalization of its lending facilities,” according to minutes from the Fed’s Dec. 16-17 meeting.

While that’s the most direct reference to raising rates that the FOMC has made in years, there’s still no indication of exactly when they will make the move. The FOMC said it would be “patient” when considering changes to its current low interest rate policy, an update from its previous language that said it would be “considerable time” before any rate rises. The central bank last raised interest rates in June 2006.

The Fed will likely continue to keep interest rates near zero for the next several months. Many analysts are pegging May for a possible rate rise, given Yellen’s comments in a press conference following the December meeting.

“The statement that the committee can be patient should be interpreted as meaning that it is unlikely to begin the normalization process for at least the next couple of meetings,” she said.

Given that policy makers meet every six weeks, interest rates are unlikely to change prior to the start of spring. Yellen and the committee have continued to emphasize that any future rate increases would “depend on its assessment of actual and expected progress toward its objectives of maximum employment and 2% inflation.”

Consumer prices declined 0.3% in November, partially driven by the steep drop in gas prices, according to Labor Department data. Inflation has remained below the Fed’s stated target for 31 consecutive months.

Meanwhile, the U.S. employment situation has been steadily improving, with employers adding 2.65 million jobs through November last year. Economist’s anticipate December was another strong hiring month and will help bring the unemployment rate down to 5.7% from its current 5.8% rate.

While Fed officials are attentive to any future downward shift in inflation expectations, or job gains, the larger focus is that the U.S. economy continues to post steady gains.

Any future increase to interest rates would be data dependent. Even if employment and inflation meet the Fed’s standards, the committee would still consider keeping interest rates low if underlying economic conditions remain weak.

6 reasons why stocks may tank in 2015

Despite some tumultuous twists and turns, the U.S. stock market made big gains in 2014. But the new year has got off to a rough start with a market-wide sell-off.

In 2014, the Dow Jones Industrial Average gained 7.5% as it crossed both the 17,000-point and 18,000-point marks for the first time ever. The S&P 500 posted 53 record highs as it rose 12% on the year while the tech-heavy Nasdaq composite jumped more than 13% to its highest levels since the dot-com bubble burst in 2000.

But this year, the Dow has already lost more than 2.5%, and it is more than 700 points behind its record levels of just weeks ago. Both the S&P 500 and the Nasdaq have also dropped by roughly 3% during that time because of concerns about the European economy and falling oil prices.

Despite 2014’s record levels, this year’s slow start has some market analysts declaring an end to the bull market and predicting that Wall Street’s bear is emerging from hibernation. Here are some reasons why 2015 might be a disappointing year for the stock market:

Jobs data, CES and the Fed — what to know for the week ahead

Happy 2015! As the first full work week of the year kicks into gear, here’s what you need to know.

1. Congress kicks off its 2015 session.

The 114th session of Congress kicks off on Tuesday. Republicans took control of both the House and the Senate in the recent mid-term elections, marking the first time the party has held dual majorities since 2007. New Senate Majority Leader Mitch McConnell aims to prioritize the Keystone XL pipeline approval, a long-time goal for Republicans. Also on the agenda for the new session: confirmations of U.S. attorney general nominee Loretta Lynch and defense secretary nominee Ashton Carter.

2. CES launches in Las Vegas.

International CES, more commonly known as the Consumer Electronics Show (CES), kicks off Tuesday, Jan. 6, and goes through Friday, Jan. 9. The show features the latest and greatest in consumer technology items. This year, the organizers expect to welcome more than 3,500 exhibitors and over 160,000 industry professionals from across the tech world. Look out for innovations in the ‘Internet of Things,’ think customized security monitoring, and home automation, as well as advances in drone equipment.

3. Experts gather for an annual cybersecurity conference.

The International Conference on Cybersecurity convenes on Tuesday in New York. The meeting will feature talks by National Security Agency Director Michael Rogers, U.S. Attorney Preet Bharara of New York, and Lisa Monaco, President Obama’s assistant for homeland security and counterterrorism. Top companies — including Deloitte, IBM IBM and Pfizer PFE — will also be presenting on specific security concerns, such as how to protect trade secrets and digital forensics.

4. December’s jobs report.

The final jobs report for 2014 comes out on Friday, and analysts expect the unemployment rate to fall to 5.7% — the lowest level since June 2008. Analysts anticipate that 243,000 jobs were added in December. That would add to the 2.65 million gains reported so far in 2014, the best year for job growth since 1999.

5. What will happen to interest rates in 2015?

Minutes from the Federal Open Market Committee’s final meeting in 2014 will be revealed on Wednesday. They may provide further insight into when Fed policy makers envision raising interest rates for the first time since late 2008, as well as what economic conditions would cause them to tighten policy. In its statement following the Dec. 16-17 meeting, the committee said it would be “patient” on the timing for any rate increase, a change from its previous pledge to keep interest rates low for a “considerable time.”